In 2012, domestic sales in the Chinese condom industry were approximately 9.55 billion, increasing by 9.77% YOY. The annual growth rate of domestic condom sales volume in 2011-2012 were lower than had been forecasted in 2009, mainly because of the declining volume of government purchase and the lack of influential new products in China condom market.
Along with the constant improvement of Chinese economy, the increase of floating population and the declining fertility rate caused by one-child policies and the rising status of women in China, it is predicted that the demand for condoms in fields like contraception and VD prevention will keep increasing constantly.
Before 2002, condoms belonged to the scope of Chinese sanitary product management. The relatively strict management by the government led to low output and limited market scale. Since 2002, the Chinese government has released the control and management of the condom industry, which has led to China's condom industry developing rapidly.
The condom industry is a relatively special industry in China and its market can be divided into two parts. The first part is government procurement. The Chinese government purchases about 2 billion condoms for free distribution every year, which are used for family planning and prevention against venereal diseases.
This part of the market is purchased by the governments at all levels from designated enterprises. There were 15 designated enterprises in China in 2010. Although the condoms purchased by the Chinese government are in large volumes, their average unit price is very low with only CNY 0.15-0.50 per piece.
The market outside government procurement belongs to the commercial condom market. This part of the market suffers fiercer competition. There exist a large number of condom brand enterprises in China, with its number reaching over 200. Most of these enterprises do not produce condoms and they sell the condoms after packing through domestic order or procurement of imported condoms in bulk.
China is the fourth largest condom maker in the world, and yet its people don't tend to use condoms -- at least not until recently. China's condom market will grow by nearly 60% in the next five years. That could spell big profits for foreign condom makers, particularly the Jissbon and Durex brands.
Enterprise Development Holdings Ltd. (1808) shares have more than doubled in Hong Kong since the investment holding company said on May 16 that it would buy Techno Wing Ltd., which makes condoms in China.
Reckitt Benckiser, the maker of the world's top-selling condom, said in April that revenue in Latin America and Asia-Pacific jumped 11 percent in the first quarter, helped by Durex sales in China. Better distribution in the Asian nation has driven the condom brand's growth.
For more information on the Chinese condom industry, see the latest research: Chinese Condom Industry
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